Euro in narrow range before elections. Dollar strengthening did not help, but złoty holds strong

The euro exchange rate has been moving in a narrow band between 4.23 PLN and 4.25 PLN, and in the last hours stabilizing around the upper range. Although the strengthening of the dollar did not favor the zloty, it seems that on the final stretch before the second round of the presidential elections, the Polish currency shows relative stability and resistance to external stresses.

On Thursday, the dollar strengthened due to turmoil on the bond market. The US had to propose an additional premium for 20-year bonds due to weak demand. In Thursday's vote in the House of Representatives, the bills were passed by only one vote Donald Trump cutting taxes.

The strengthening of the dollar did not favour the zloty, so the exchange rate EUR/PLN rose to over PLN 4,254 on Thursday afternoon. Only for a moment, though. left the narrow band of quotations between PLN 4.23 and PLN 4.25, which has been observed since Monday afternoon, when the tensions related to the first round of the presidential elections subsided and US rating downgraded before the weekend.

On Friday morning the EUR/PLN exchange rate was around At 9:32 it was already 4.2452 PLN, which is more or less the same as the day before. at this time. "We are a week before the elections. The results of the first round were impact on the prices of Polish assets. I think the zloty will wait for the outcome of these elections," Monika Kurtek told PAP Biznes, Chief economist of Bank Pocztowy.

PKO BP analysts indicated that the macro calendar for Friday is poor, so the impact on the zloty should mainly be the global appetite investors at risk.

"In this context, a lot will depend on whether US Treasury bond sell-off to continue wrote in their commentary. In their opinion, the continuation of this trend will probably would negatively impact global investment sentiment.

"And for this reason we believe that at the turn of week, moving the EUR/PLN rate closer to the level of 4.26 is a scenario base," they pointed out.

Thursday's strengthening of the dollar brought the EUR/USD rate down below the level of 1.126 dollars, but Friday brought a rebound, reaching the rate in the morning was over 1.133. The dollar to zloty rate was falling and the USD/PLN pair was traded at the level of PLN 3.7434, although on Thursday it was over PLN 3.77.

Nothing has been happening for a few days on the CHF/PLN pair. The exchange rate Swiss franc remains in consolidation around the level of PLN 4.54. On Friday after 9:25 a.m., franc was paid 4.5389 PLN. For over a month now, the Helvetian currency has been moving in the range of 4.50-4.60 PLN. In turn, the British pound was quoted at 5.0489 PLN, or about 1.5 groszy more expensive than on Thursday morning.

MK

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